As tobacconist firebombings intensify in Melbourne, nearby stores are being denied insurance
Summary
Small businesses near tobacconists in Melbourne are having trouble getting insurance or facing higher costs because of increased firebomb attacks linked to criminal groups fighting over illegal tobacco sales. These attacks have caused significant damage and made insurers see nearby shops as high-risk, leading to denied or limited coverage.Key Facts
- Over 200 firebomb attacks on homes and businesses in Australia since 2023 are linked to criminal groups competing in the illegal tobacco market.
- A recent fire in Richmond, Melbourne, destroyed a tobacco shop and nearly a dozen nearby stores, involving 80 firefighters.
- Some insurers, like Suncorp, have stopped offering insurance to tobacconist retailers and may deny coverage to nearby businesses.
- Small businesses near tobacconists report difficulty renewing insurance or must pay higher prices without fire coverage.
- Businesses within about 20 meters of tobacconists are generally considered higher risk by insurance brokers.
- Illegal tobacco made up 80% of cigarettes smoked in Australia in 2025, with much lower prices than legal cigarettes.
- There is an ongoing political debate about reducing tobacco taxes to lower illegal sales, while health experts want stronger law enforcement.
- Authorities warn that firebombings hurt local shops by reducing customers and damaging reputations, adding financial pressures on small businesses.
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